The volume of non-performing (distressed) loans in the Saudi banks dropped by 4 percent to SR16 billion by the end of Q2, 2014, compared to SR16.8 billion in the same period last year, according to a financial report.
The coverage of accumulated provisions to the distressed loans in the Saudi banks grew by 165 percent in Q2 compared to 157 percent in Q2, 2013, the report, carried by Al-Eqtisadiah daily, said.
The accumulated provisions grew by 1 percent to SR26.5 billion compared to SR26.3 billion in the comparable periods, the report added.
The Saudi banks set aside provisions worth SR1.33 billion in Q2 compared to SR1.26 billion in the same period last year, or an increase of 5 percent, the report said.
The banks normally set aside provisions aimed to safeguard the banks from possible failure of customers to repay loans though they put pressures on their profits. However, the provisions are reflected as profits if not used to cover the distressed loans, according to the report.
The two banks also captured the biggest portion of the distressed loans by the end of Q2 at SR3.2 billion and SR2.9 billion, respectively, the report added.
Other banks had different sizes of distressed loans by the end of Q2 as follows: ANB at nearly SR1 billion,
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